Tonix Pharma PTSD drug shows promise in mid-stage study

Tonix Pharmaceuticals Holding Corp said a higher dose of its experimental drug reduced symptoms in post-traumatic stress disorder (PTSD) patients, offering hope of a new treatment for the mental condition in more than 15 years.

The company's shares rose as much as 30 percent to $3.77 in early trading on Thursday but pared gains to be up 6 percent in morning trade.

Cantor Fitzgerald analyst Chiara Russo said she was a lot more optimistic about the drug following the results and the relatively benign side-effect profile of the treatment.

Tonix said it could start the first late-stage study as early as the first quarter of 2017. The company is also preparing for a second late-stage trial, should the U.S. Food and Drug Administration ask for one.

Tonix would prefer securing a partnership for the drug over going back to the markets to raise funds, Chief Executive Seth Lederman said in an interview.

The company had cash, cash equivalents and marketable securities totaling about $43 million as of Dec. 31.

PTSD affects about 8.4 million Americans and is a severely debilitating condition in which patients re-experience horrific traumas from the past in forms of intrusive memories, flashbacks and nightmares.

The condition is more prevalent among the military population and the company has partnered with the U.S. Department of Defense to help develop the treatment.

Up to 20 percent of Operation Enduring Freedom and Operation Iraqi Freedom veterans, up to 10 percent of Gulf War veterans and up to 30 percent of Vietnam War veterans are estimated to have experienced PTSD, according to the U.S. Department of Veteran Affairs.

Tonix's stock had lost about 62 percent of its value this year through Wednesday's close.